The business behind the show

Battle between Cablevision and Fox looks headed to extra innings

October 13, 2010 | 1:07
pm

The stage is set for a rematch of last year's big battle. The pitchers are warming up. The hitters are taking their cuts. The managers are trying to figure out the opposing team's strengths and weaknesses.

No, we're not gearing up for a potential rematch of the Phillies and Yankees in the World Series. We're talking about the showdown between News Corp. Chief Executive Rupert Murdoch's Fox and Cablevision Systems Corp., the New York-based cable operator run by the Dolan family that has over 3 million subscribers primarily in New York City and Long Island.

The deal Cablevision has to carry News Corp.'s television stations expires at midnight this Friday. It is actually an extension of an old deal that the two companies agreed to extend a year ago when they were deadlocked and couldn't reach an agreement on a new pact. The channels whose deals are up are WNYW, the Fox station and WWOR, an independent station. There are also a couple of cable channels involved in the talks including Fox Business, but the sticking point is terms for a deal for the TV stations.

Cablevision has taken to the airwaves and print saying that it already pays News Corp. $70 million every year for its channels and now the media giant wants more than $150 million. It is similar to the strategy that the cable company took with Walt Disney Co. when the two were deadlocked over a new deal for its ABC station in New York and several cable networks including ESPN. In that case, Cablevision argued that it was already paying Disney $200 million a year for its networks and now the company wanted $40 million more. A deal was reached after Disney briefly pulled its channels from Cablevision homes.

In a statement, Cablevision said: "In a difficult economy, it is unfair and wrong for News Corp. to demand huge fee increases from Cablevision customers." A Fox spokesman countered that"contrary to Cablevision’s statements, we are not asking their subscribers to pay any more money. We are simply asking Cablevision for fair compensation."

While both sides are ratcheting up the rhetoric, neither is talking specifics about what terms are being sought. When News Corp. was in a similar squabble with Time Warner Cable, it was seeking $1 per subscriber per month. The two sides reached a deal without any channels being pulled in a multiyear contract that eventually gets close to that figure.

For now, Yankee fans don't have to worry because the American League Championship Series is on TBS. But if the Yanks get past Texas and make the series, things could get ugly fast.

--Joe Flint

For the record. An earlier version of this post incorrectly stated that the Yankees were facing off against Tampa Bay for the American League Championship. They are playing Texas.